RIAA Two Top Execs Made $4.8 Million In 2009; How Many Musicians Could That Have Funded?

from the just-wondering dept

As a whole bunch of folks have been sending over, RIAA President Cary Sherman made $3.2 million in 2009 -- the highest paid "non-CEO staffer who is a federally registered lobbyist in a tax-exempt organization" by more than double. Meanwhile Hypebot adds in the details that Sherman's official "boss," RIAA CEO Mitch Bainwol made "only" $1.6 million that year. Kinda makes you wonder what exactly the two of them did that deserves that kind of cash. Presided of an industry that's collapsing? Got Congress to pass new laws that didn't help and really only served to make things worse? This seems like pretty strong evidence that the labels, perhaps, should be giving less money to the RIAA. After all, we keep hearing about how the labels don't have enough money to invest in new artists these days. You could make quite a few new albums for $4.8 million. And I doubt the RIAA would do much worse without Sherman or Bainwol around. Hell, the RIAA could pay me half of that, and I'd actually help them move forward, rather than trying to keep pretending that they can bring back 1990.

Reader Comments

Obviously you haven't been paying attention to the balance sheets... An established, successful, "safe" band might be able to make one or two albums on $4.8mil, but it's more likely that they'd be losing money.

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Obviously you haven't been paying attention to the balance sheets... An established, successful, "safe" band might be able to make one or two albums on $4.8mil, but it's more likely that they'd be losing money.

Wasn't talking about "established" safe artists. After all, those folks already are making a living. The point was helping the artists who aren't yet making a living. Wasn't that who the RIAA keeps claiming they're so concerned about?

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Sarcasm aside, $4.8 million is probably on the low end for distribution, promotion and other costs... if you insist on doing things the old-fashioned way.

In this day and age? Web-hosting for a couple of dozen MP3s, a list of tour dates and a link to your CafePress store is about $50 a month*. A reasonably modern PC with a good soundcard, a couple of mics and some editing software cost less than a grand and give you recording facilities a sound engineer would have given his left nut for ten years ago.
By my reckoning, someone prepared to deal with the world the way it is rather than the way they wish it was could make a couple of thousand albums that way.

* Some day I'm going to sit down and work out exactly how many downloads of an individual file one such web-hosting service could cope with, so that we know the exact marginal cost of distributing music online.

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A reasonably modern PC with a good soundcard, a couple of mics and some editing software cost less than a grand and give you recording facilities a sound engineer would have given his left nut for ten years ago.

That's a huge misconception. Recording has become cheaper but not that cheap. Here's a "very basic" home studio breakdown.

That's ~$3200 just to get sound "on tape" one instrument at a time. I have no idea how you're going to record drums, since those generally require a specific set of drum mics.

Now, for the room you're recording in: you're going to need acoustic treatment. At the very least you'll absolutely need bass traps. Let's just guess you'll spend $300 on those and some other very light acoustic treatment. Oh wait, where are you going to mix those songs down? Rooms that are good for recording are often not the best room for mixing. But if you must, then we need a floating cloud above your sitting position for mixing, plus panels on the two wall surfaces parallel to your sitting position. $150?

I pray to god that if you are going to track and mix your own music, you're smart enough to know that it's a *terrible* idea to then try to "master" the recording yourself. Hire a budget-minded pro mastering engineer: $500.

Total: $4150. And this is just to get sounds recorded. No distro, no promo budget. It's not a lot, but still out of the reach of most musicians.

I'm of course leaving out the cost of learning how to position mics and how to record in general. Forget about the difficulties of learning how to mix and the fact that mix engineers spend a lifetime honing their craft. And like I said, if you're doing the whole process yourself, then please please please god have your work mastered by a pro who knows what he's doing and is familiar with making sure home recordings are "broadcast ready and compliant."

Oh yeah, instruments also cost money. *Good* instruments that will sound nice on a recording cost a lot of money. We'll ignore all that.

And I'm not trying to be jerk here. The set up I've just described is basic basic. It's what I have at home. A pro engineer reading this is probably gagging at the idea of running a decent mic through such a flimsy pre amp, recording and mixing in the same room, doing your own acoustic treatment, etc.

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Well, I know from photos of the band (where the girl, as usual, is staring straight into the camera) that they use the same mic I have, the EV RE-20. This is also the same mic you see in the current Geico commercials set in a talk radio station. It's also the mic Rush Limbaugh uses (except his is GOLD-PLATED!). It's basically the mic that every single radio station has. It's not particularly suited for recording music, but it is more than capable of handling the job. It's an awesome mic.

I can also see acoustic treatment in their "studio". They actually have a fairly big room for recording/mixing. Probably part of their rent, but still, not cheap to maintain.

That being said, I'll go out on a limb and guess that Pamplamoose has a similar soundcard, definitely has similar audio programs (they are mostly interchangeable), and they probably have better speakers, but I don't know, their recordings aren't exactly pristine, or even clear. Maybe they mix entirely on headphones?

Like I said, I'm not trying to rain on anyone's parade. This is just a realistic breakdown of what someone who wants to get into home recording will have to spend. And frankly, what I've described is a poor setup. Laughably bad in the eyes of a professional working in the field.

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And I'm not really trying to refute your expert opinion, I'm just musing that maybe "laughably bad" is enough to break onto the scene. And if your promotion and distribution is through YouTube/Facebook/whatever, then that part of the sheet is $0 (or maybe $45-$60 if you're going to claim the entire Internet connection as an expense).

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Oh, I'm no "expert" by any means. I've just been into home recording for a long time.

You are definitely right, a lot of recordings that come out now are... to be nice: delightfully amateurish. I don't begrudge that. I love a band like Sebadoh, who is terribly lo-fi. But people like me who are fascinated by lo-fi recordings are few and far between.

But consider Rebecca Black, sounding that bad still required an actual recording studio which most likely had isolation booths and a separate rooms for recording equipment and recording instruments (computer fans make a lot of noise!)

Promoting through Youtube and social networks is certainly possible on a budget, but it's still not a silver bullet for success. Consider that major labels pump millions into promotion on those same services. An unsigned artist still has to compete with that.

I should also point out that Pamplamoose are on a label (Shadowtree Music), so it's not as if they operate without a budget.

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Wait, are you saying it takes $4.8mill to make one or two albums for one band? No wonder the recording industry is dying. Getting hired by them must be like getting a government contract except the labels can't keep taxing people (yet).

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That argument would fly better than a one-winged concrete plane if all that pesky evidence about albums being setup to intentionally lose money on paper would just disappear.

Think of it rather as venture capital. Give $50K to 96 different undiscovered bands. That'd be more than enough for them to get their music out there with the near zero cost of packaging and distribution that the internet enables. If even 1 ends up making $5 million, you're in the black.

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Well, that would be a little short-sighted of the RIAA. There are more than 96 undiscovered bands in the lower half of Mississippi alone. Probably more than 1000 in just one neighborhood of Brooklyn, NY. There are probably 10s of thousands of unknowns in the US. The chances of any 96 bands even staying together as a group through one album cycle are very slim.

And I don't know that any band outside of a label, especially having no physical product, has ever reached even close to $5 million in sales. That would be more than 5 million paid single-track downloads after iTunes/whoever takes their cut. Just getting 5 million views/plays is nearly impossible for anyone except the biggest name acts.

And if you hoped to recoup through streaming/subscription; you're talking about needing somewhere in the realm of 500 million plays on Rhapsody, 3.3 billion(!) streams on Last.fm or Spotify (my calculator can't actually handle these numbers!)

I would rather see them give 10 grand to 480 established independent artists. And even then: who? Jazz musicians? Classical musicians? Indie bands? Hip hop artists? DJs?

The more interesting question to me is how much vaulted music could be released, or at least maintained properly in storage with this money?

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Re: $4.8M

What? They need to buy a recording studio to make an album? You must be one of the record label lackeys. I could lay a lot of digital tracks for a lot less than $100K. The point is that they don't need a record label for recording or distribution. Albums are not the method of recording or distribution any more, or haven't you heard? Since the age of inexpensive "digital recording" and "digital distribution", the record labels don't control either of those technologies any more. Their establishment was by gaining control over these two technologies, and their demise will be through loosing this control. But music and musicians will continue and thrive. We don't drive horse and buggy's any more, but we drive cars. Where are the manufacturers of camera film today? Where will the record labels be tomorrow?

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They are doing all of this to help protect the artists, and yet can never show payments to the poor starving artists. Heck even with LimeWire it took public opinion for them to decide rather than fund themselves they should make token payments to those they claim to represent.

And we wonder why people can look at organized groups like this and wonder if any of them actually do what they claim anymore or is it just about them making sure they get paid.
I mean honestly, we donate tons of money to cancer research yet see no progress.
We donate to the Red Cross to help out those in Japan only to learn the American Red Cross is keeping that money in their war chest while they see if they need to send anything.
Why do we continue to think that any group serving a cause will actually do anything to fix the cause that gets them a paycheck?

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Response to: That Anonymous Coward on May 23rd, 2011 @ 9:17am

I know I am cynical but this is why I do not donate to any causes no matter how noble they come off. I do respect Bill Gates' foundation though as he is notorious for demanding accountability and transparency for where his foundation's money is spent. Missing those qualities is why Microsoft has been in the shitter since he left.

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There has been plenty of progress in cancer research. You should compare the general outcomes of cancer patients over the past 30 years (of nearly all types of cancer).

It's a common mistake to think of cancer as one type of disease, the way small pox was one virus. Thinking of a single "cure for cancer" is like thinking of a single "cure for infections." There are many different types and they all have to be treated in unique ways.

So... someone take advantage of this?

It's an open market, right?

Why not apply Techdirt’s CwF + RtB towards a competing Music association that out"profits" the various Recording Associations? Your business model of sharing+caring should earn Techdirt revenue well above the million dollar range, possibly even the 100 million dollar range to shut you up?

Re: So... someone take advantage of this?

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Never underestimate human laziness. Why do you think record labels still exist at all? It's so easy (OK, not that easy) for anyone to make their own way on the Internet, why doesn't every band do it? They still think the money they lose is worth the work they don't have to do. There will always be a place for a smart manager (even label) who will do the managing, billing, booking, what-have-you.

How many of you pay someone to mow your lawn even though you could do it yourself for much less? I know I would if I could afford it.

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You say laziness, I say specialization. If an artist wants to pay someone else to manage the business while he concentrates on being an artist, I'm OK with that. He'd just better be careful that his hired help doesn't do something stupid like sue his fans.

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I totally agree. The problem with the current situation is in effect you're hiring a gardener to mow your lawn, but when you come to sell your house it turns out you owe him 99% of the profit you make on the sale, perhaps more.

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Billions? Limewire alone cost trillions in damages. Piracy as a whole is probably costing more money then exists on the planet. With those kind of losses 4.8mill is like me being broke yet still giving the homeless guy a quarter.

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The fact that the RIAA/Labels are viewed as the bosses is what's really stomach-churning to me. When I contract with someone to provide me a service, *I* am the boss, but that's reversed in the music industry.

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I am not at all sure where I said here that I fail to see a problem with so much of our copyright laws today.

I merely commented on the article trying to make a mountain out of a molehill that is not even relevant to the issue at hand.

So they make money. Seems to me they are selling scarcity (their time), and appear to be making a bundle doing so. Do I think they are likely overpaid? Yup. Do I think this is relevant to the point you are trying to make? No.

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It's not irrelevant. If you are begging for handouts (in the form of made to order legislation) and claiming that your business is dying, it's pretty telling when you have top execs making that much money.

The point is, they want us try to convince us of one thing and then they do something else entirely.

Two Issues here

Executive compensation is a separate issue from the tactics the RIAA is using to destroy our rights. Yes it seems wrong they are getting paid obscene amounts of money but the true issue is the desire and strategies to erode then destroy our rights. If we sit around and whine about how much they are getting paid and what that organization isn't paying artists, that detracts from the core issue. Yes, Cary and Mitch made more money than you and I and 99.9999% of the artists they are supposed to represent but they are working for a private organization and that organization can pay as they please under our form of capitalism.
I agree that executive compensation is a true resource drain to our society that should be addressed but focusing on that won't help the (in my mind) bigger issue of our rights.

Announcer: "Ladies and gentlemen we have a first time poster here. Please give a warm welcome to 8chip8>"

8chip8: "Wow, so like anyone can write a post here? anyone with any qualification? any skill set? even people with giant brain tumors that are virtual retards?"
Show Host: "Yes it's true. Unfortunately anyone , yes anyone can post - even that kid Corky from life goes on provided his fingers don't slip off the keyboard from all the drooling"

8chip8: "Well then I would like to make a comment"
Show Host: "8chip8 the floor is yours"
8chip8: "I think the person that started this thread is a dumb doody head"
Show Host: "8chip8 why are you so angry, no need to be mean to the guy. He just had an opinion"
8chip8: "Yeah, but his opinion is stupid and he is stupid. First of all, what was the point of his post. To be the one millionth person to realize that there's an overpaid executive somewhere. Oh no! and overpaid executive! Everybody run! And then he babbles for a couple sentences and says something about being willing to do the job for half the pay. Moron. First of all, did someone offer you the job. I didn't think so. Second, if they did offer you the job, what are your qualifications? Nerd doesn't quite cut it. Finally, what is your plan? Play rock music really loud and create a bitchin work environment for your staff? Well if I were you maybe I would maybe want to consider the fact that the companies that pay these salaries have a different plan.
Show Host: Well you're actually a little wrong there 8chip8. Mr. Moron did actually suggest using the extra money to develop new albums
8chip8: Which is another reason why the guy is a moron. How many times have we all heard how someone could spend the money better? A million? A billion? I could give 100 people 100 dollars each and there'd be 200 ways to spend it. If you want to actually make a difference, save the money and invent a time machine, then travel back to the beginning of man and give him gene therapy that removes the greed trait (of course this would just screw us because we need the hoarding/take more than you need mentality to survive long winters.)
Show host: "Wow that was pretty rough"
8chip8: Yeah it was. The poor guy didn't deserve it. He just thought he had something worth saying, just like me. Only it was BORING and STUPID.
Show host: "Ouch - that's all we have for today"

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I vote points for more entertainment, coherency and proper capitalisation than darryl or the ACs.

On the other hand, first-time poster -> first time reader more like. All this stuff has been explained in much more detail if you bother to read back and put more effort into that, instead of finding fancy ways of calling Mike a moron.

I am confused..

when was the RIAA ever about paying money to musicians? I thought the whole purpose of RIAA was to fund the huge salaries of the RIAA executives? Has the RIAA ever actually paid anything to musicians, other than perhaps paying for them to play at their parties?

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Actually, there's a point here: the RIAA isn't the music industry, they're a lobbying group, right? So doesn't it make sense that they'd spend all their money getting choice laws enacted, and give the rest of their "income" to the execs (since they're non-profit)?